Imagine an ideal case scenario where you can live in a modern, first world yet high tax country, protect your future with a life insurance or pension product and indefinitely defer or completely avoid taxation – in other words have offshore asset protection and legal tax avoidance or have your cake and eat it.
Ideal but impossible right? Wrong! Thanks to some incredibly clever thinking, planning and structuring from our friends at The Sovereign Group, offshore asset protection and legal tax avoidance is exactly what you too can potentially achieve depending on your personal circumstances. Read on to understand how it works…
For this scenario we will use the example of a UK resident and domiciled individual – yet this entire scenario or something very similar is, in most cases, possible to achieve for those resident and/or domiciled in other high taxation nations such as America or Australia…please note that the information contained in this article may not be applicable to you and does not constitute advice and if you want to find out more, .(JavaScript must be enabled to view this email address) to be put in touch with a Sovereign specialist who can advise you.
If you reside onshore and were to attempt to establish a straight offshore company, do business, invest, trade or raise an income through it and avoid taxation through the use of the company you would not legally be able to do so.
There are rules in almost every country in the world known as ‘attribution rules’ whereby if a taxation authority can attribute ownership, responsibility or benefit from an offshore structure to an onshore individual then taxation is due.
However – because every responsible nation in the world wants us all to protect ourselves and our families and our financial future there are legal and encouraged taxation breaks available on certain pension and life insurance products and this is what got Sovereign thinking. They were already aware of the tax wrapper solutions available from the large insurance houses which make use of complex structures involving such tax efficient vehicles - but they were also aware of the huge costs, fees and commissions that investors and savers suffer annually and Sovereign wanted to come up with a far more affordable, flexible and attractive legal and secure solution.
Through the use of specialist and secure smaller insurers it is possible to have an insurance contract created to, for example, own the shares of an offshore company which can then be used to invest or trade on many levels and generate potentially high returns thus offering security, flexibility and a legal solution to tax deferral or avoidance. And by then placing the insurance product within an offshore company which is owned by an offshore trust all current liabilities, charges and taxes the UK revenue could potentially demand are also negated.
This is an incredibly clever and complex structure made simple here just to demonstrate how efficient it can be – if you want to learn more then .(JavaScript must be enabled to view this email address) and we’ll put in touch with a Sovereign representative in your area who can talk to you about your options from a more informed position.
